Paul Buchheit: Not getting health insurance is a really bad idea | Hacker News Reader

Paul Buchheit: Not getting health insurance is a really bad idea

paulbuchheit.blogspot.com

26 pointspaul24 comments

A few months back, a friend and I got hit by a car.

We were minding our own business, talking about our startup activities, crossing on the green, and some idiot ran the light and hit us. Neither of us saw it coming, and it hurt really, really bad. ER bills were big, I'm glad I had insurance.

Two weeks ago I was walking to work and saw a guy collapse against a building. I called the emergency number and tried to help him, along with several others, but the guy was completely out, he died right there. I wish I could say differently, but that's what happened. He wasn't particularly old, either.

Ready or not, you might as well have health insurance.

Here in the UK I've heard of people "running lights" in the USA. It doesn't happen very often in the UK. Someone driving through red knows that they're likely to have an accident or mow down a pedestrian.

I've long wondered if it is the USA's lack of roundabouts compared to the UK that causes many Americans to grow frustrated sitting at red lights when there's no traffic driving across them on green that makes them conditioned to drive through red.

My neighbouring desk for a year for a hotdesk to the visiting American on a two-week tour of duty. For many it was their first UK visit. The majority liked roundabouts after a couple of days, preferring them to junction lights.

Roundabouts.... hrm. I used to work near the one of the few in San Francisco (8th & Townsend) and occasionally people would take the shortest path around it. Kind of scary. And what's really scary is being a cyclist in a roundabout somewhere like Italy. I much preferred the traffic lights before they replaced them with roundabouts in Padova. It's bad enough playing chicken in a car, let alone a bicycle.

Well I guess roundabouts to someone not used to them are dangerous, just like traffic lights.

I'll see your Padova roundabout and raise you The Magic Roundabout: http://en.wikipedia.org/wiki/Magic_Roundabout_(Swindon)

It's five roundabouts arranged in a circle with connecting roads between them on the edge of the circle. It effectively creates a bigger roundabout in the middle with contra-flow.

I grew up in the UK in the 70s and 80s and there used to be public service announcements about the dangers of being an "Amber Gambler".

that was enough of a kick in the ass to sign up for coverage (after having intended to for a while but never really getting around to it), thanks for the post :P

btw, other summer yc founders in cambridge (or other massachusetts residents): go to http://mahealthconnector.org ; the lowest plan costs like $119/mo and it takes like 5 mins to enroll and it's all online.

I randomly got sick and then developed bad pneumonia. I ended up staying in the hospital for almost a week while recovering and then was fine. Total cost for diagnostic tests, medicine, and my stay was ~$30k. I was in disbelief when my HMO covered absolutely 100% of it. Because I had insurance I was only in pain for a week instead of a year.

- Isn't that like a safe job with a 100% chance of low income vs a startup with 10% chance of jackpot? With health insurance, you're assuming bad luck, but with a startup, you're assuming the opposite.

- 77$/month is still quite a bit of money. Even if you absolutely want to spend it on safety, it's not clear that insurance is the best way to go. Upgrading those frozen dinners to bio food might be a better bet for long-term health. Or buying a bike helmet, living in an unpolluted area, taking time to exercise daily.

- When you're twenty-something, there is a rather low number of incidents which are not a) low-cost enough that you can take care of it and b) curable at all

I have health insurance now, but I'm not sure that it's such a wise investment. I find it hard to make an honest assessment of how much it is really worth. Anyone have hard data on this?

It's not at all the same. Do you understand the difference between buying a lottery ticket and playing russian roulette?

Your strategy should be to seek upside while limiting downside.

Well, I've got to admit that I don't see the fundamental difference. One involves death, but death is also quantifiable.

"Your strategy should be to seek upside while limiting downside.": But it's all a matter of degree! Taking insurance would be a dumb idea if it costed 5000$/month, wouldn't it?

Plus, there is all this business about being risk-averse or not, for which there is no rational answer. People who stick to their safe jobs are risk-averse. It makes absolute sense for them to get insurance, as long as its expectation value is not too negative. People who do startups, however, are less risk-averse. They accept a game in which the EV is higher, but variance is also high. Not taking insurance is a very similar game: higher EV (presumably; it depends on the value and probability of death), higher variance.

Loto and russian roulette both have low EV and high variance. They both suck.

So would you rather have a 100% chance of an exciting life, or a 99% chance of a slightly more exciting life + 1% chance of a really bad one?

I believe there is no single answer to the question, even if you quantify everything. It depends on how risk-averse you are.

But maybe I'm just blinded by mathematics. If so, I'd appreciate a correction.

Like I said, it's about controlling downside. The downside of losing the lottery is that you lose a dollar. The downside of losing at russian roulette is that you die. It's a mistake to only consider expected value.

Risk is something that should be intelligently assessed and balanced, not blindly embraced.

It's also a mistake to equate "not winning" at startups to failure. I'd rather work at a string of unsuccessful but fun startups than some soul-crushing big company.

"It's a mistake to only consider expected value."

Agreed, to be precise, one has to look at the entire value range, associated probabilities, and their effect on one's personal "happiness function". That's what I was trying to do with my variance "estimates", since most of these things are pretty gaussian anyway.

"Risk is something that should be intelligently assessed and balanced, not blindly embraced."

Also agreed, and that is precisely what I am trying to do with regards to the real value of health insurance (admittedly without much quantitative data). So far, all I see in this thread is anecdotal evidence of some catastrophic events.

"I'd rather work at a string of unsuccessful but fun startups than some soul-crushing big company.": Me too, but that depends on a whole lot of personal factors, and there is no one right answer for everyone. Likewise for health insurance.

I had no insurance a couple of years ago and needed a minor outpatient surgery. The surgeon worked with me on the price and charged nothing for the follow up office visits. The cost of the OR comprised about 90% of what I had to pay as the hospital only gave something like a 10% rate reduction.

Taking everything in to consideration, it cost me about the same out of pocket for that to have insurance versus not having insurance, including the cost of premiums for a couple of years. Afterwards, I decided I'd be better off with insurance in case something bad happened.

I've only known one person who had a huge medical problem without insurance, and, after spending some months filling out forms for the hospital and various programs for uninsured people, he wound up paying only the bills from the doctors. All but one of them offered a decent reduction in their fees, and I think a couple dropped them all together. All said and done, he was relieved of around $250,000 of debt.

From my experience, I think it's a good idea to have some type of health insurance just in case you hit a worst case scenario.

That would depend on the value you put on your health/life.

For me P(illness)ValueOfLife exceeds P(startupSuccess)ValueOfStartup

If you're in NYC, check out Freelancer's Union. Like Paul, I saw a guy lying face down on the street the other day after he was run over by a truck crossing a perfectly normal street corner. Made me glad I had my coverage ($150/month)

there is also Catastrophe Health Insurance

State Farm will approve you over the phone for catastrophic health care for $40 a month. That is what our startup is on. If something goes wrong it's a $2500 deductable but everything else is taken care of. So if you need stitches, you're hosed, if you need a new kidney, it only costs $2500.

Godspeed.

Sure, get insurance! But also make sure to eat good food, and do sport.

Great post Paul. Concise and to the point.

After watching SiCKO, I'm less convinced that insurance is really the answer. You get denied treatments even if you have insurance.

The whole system is messed up :(

It's obviously not perfect, but the notion that it's worthless is dangerously wrong. I can confirm from experience that it covers treatment at least some of the time (nobody I know has been denied).

It's pretty safe to be fed up with politics and not participate, but it might be dangerous to give up on medical care altogether :-)

Well, obviously Michael Moore isn't going to film a happy family getting taken care of by a friendly company. There wouldn't be much point in making a movie about that.

Here's the counterpoint to Sicko. 6 month+ waiting lists for MRI/CAT scans, and 1 year+ waiting lists for routine operations until you die, or they have to remove parts of your body: http://www.freemarketcure.com/

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